Shared royalty platform for content royalty management

ABSTRACT

Systems and methods for the dynamic processing of royalties are disclosed. Sales records are processed on a transaction basis rather than in batch mode. This process also allows correction of information retroactively, rather than delaying the entire processing of the information. One embodiment includes a system comprising a message broker in communication with a plurality of clients and services, a state machine, a processor and a time manager. The message broker interacts with the processor to execute a common service based on events produced by the state machine. Another embodiment includes a method comprising providing a rate matrix, receiving a sales record from a database and calculating a royalty payment using the sales record and the rate matrix.

CROSS-REFERENCE TO RELATED APPLICATIONS

This application is a divisional of U.S. patent application Ser. No.12/024,281 filed Feb. 1, 2008, which is a divisional of U.S. patentapplication Ser. No. 11/637,935 filed Dec. 13, 2006, which claimspriority to U.S. Provisional Patent Application Ser. No. 60/749,611,filed Dec. 13, 2005, the disclosure of which is hereby incorporated byreference in its entirety.

BACKGROUND OF THE INVENTION

1. Field of the Invention

The invention relates to systems and methods to process royalties basedon existing information as soon as it becomes available. Sales recordsare processed on a transaction basis rather than in batch mode. Thisprocess also allows correction of information retroactively, rather thandelaying the entire processing of the information.

2. Description of Related Art

Royalty management for audio and video content products is a verycomplex area. Recent years have witnessed a tremendous growth of audioand video product publishers, with new product labels springing up andold labels being acquired. These factors alone have made the managementof royalties extremely complicated, but furthermore, the volume ofproduct transactions has increased greatly and is expected to explodewith the advent of new media and delivery methods, such as product filedownloads, pay-per-listen, pay-per-view, etc. As a result, currentbatch-type processing of royalty earning calculations is badlybottlenecked and soon will be so inadequate to handle the volume oftransactions that it will be unusable. If it takes more than 24 hours toprocess a batch that means that the batch cannot be processed daily andthus must be processed less frequently, typically weekly. And once therun time for a batch process exceeds seven days, the batch may only beprocessed once a month, and the resulting data will so out of date thatit is useless. In particular, royalty data that is older than one monthdoes not allow publishers to view sales activity within the month. Theresulting data has only historic value, which makes it very hard forpublishers and sales forces to react to changes in acquisitions androyalty income. An additional problem is that royalty rates often dependon the volume of either transactions, dollars, or both, and therefore,the more delays in the processing of this information, the moreconvoluted and problematic the batch processes are. Thus, the delayswill be even greater.

Thus, a need exists for a new shared royalty platform (SRP) that allowsreal-time processing of royalties, based on existing information as soonas it becomes available.

SUMMARY OF THE INVENTION

The invention relates to systems and methods for processing royaltiesbased on existing information as soon as it becomes available. Adistinguishing characteristic of the present invention is its movementover time from state to state, progressing from milestone to milestone,supporting dynamic royalty calculation processes.

Sales records may be processed on a transaction basis rather than inbatch mode. This process may also allow correction of informationretroactively, rather than delaying the entire processing of theinformation.

One embodiment includes a system for royalty management comprising amessage broker in communication with a plurality of clients andservices, at least a first state machine in communication with themessage broker, at least a first processor in communication with themessage broker and a time manager in communication with the messagebroker. The message broker interacts with the at least first processorto execute at least a first common service based on events produced bythe at least first state machine.

Another embodiment includes a method for royalty management comprisingproviding at least a first rate matrix, receiving a sales record from adatabase, loading the received sales record to a processor, publishingan initialization event message based on the sales record, activating astate machine with the initialization event message, transferring thestate of the record, updating the state of the record in the database,validating the sales record, publishing a validation event message,activating the state machine with the validation event message,transferring the state of the record, updating the state of the recordin the database, publishing a matching event message, matching the salesrecord with a product sales agreement and calculating a royalty paymentusing the matched sales record and the at least first rate matrix. Yetanother embodiment includes validating a license on a product that isthe subject of the product sales agreement.

As will be realized, this invention is capable of other and differentembodiments, and its details are capable of modification in variousobvious respects, all without departing from this invention.Accordingly, the drawings and descriptions are to be regarded asillustrative in nature and not as restrictive.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 shows an overview of the environment of the shared royaltyplatform (SRP) in one embodiment of the present invention.

FIG. 2 shows an example of a product with related copyright obligations.

FIG. 3 shows an overview of the royalty calculation processes of theSRP.

FIG. 4 shows a top-level view of the interlinking of the SRP with theRepertoire Management System (RMS).

FIG. 5 shows a generic architecture of one embodiment that allows SRP toreplace batch royalty calculation processes with a Royalty CalculationProcess.

FIG. 6 is an illustration of the main SRP Royalty Calculation Process.

FIG. 7 shows an example of a State Machine.

FIG. 8 shows an example of a Rate Matrix (RM).

DETAILED DESCRIPTION OF THE INVENTION

FIG. 1 shows an overview of the environment 100 of the shared royaltyplatform (SRP) 101 in one embodiment of the present invention. FIG. 1shows that the SRP 101 may interact with four different businessperspectives that correspond to different views on the royaltygeneration products from four worlds, and also that each of these fourworlds have their own areas of overlap and interactions. There may be aSales World 111, which includes the business perspective from the salesand marketing side; and the Repertoire Owners' World 113, which ismostly comprised of artists and rights holders. There may also be aPublishing/Licensing World 110, which comprises the people producing andpublishing the actual copyrighted works of art; and the Accounting World112, which is a fourth business perspective, and from the SRP point ofview may be an accumulator of the royalty calculation results, which areroyalty amounts with explanations and a keeper of the accountinginformation, such as accounts, and payee, for all royalty recipients. Atthe center of all these worlds is the SRP 101 interacting with all fourworlds.

The typical product subject to processing by the SRP could be, forexample, albums 120 a-n. Each album120 a . . . n may contain multipletracks. Some albums may be a compilation where each track is made by adifferent artist and may then have one common or multiple separatepublishing ownerships. FIG. 2 shows an example of a product with relatedcopyright obligations. An album 200 may have multiple tracks 201 a-n.Each track may have one or more recordings 202 a-n, and each recordingmay have one or more songs 203 a-n, or versions of a song, and each songmay have one or more publishers 204 a-n and one or more writers 205 a-nwho have royalty rights. In some cases details of the multiple songswithin a track are shown. For example, Track 2 contains a medley ofexisting songs, so both Song 1 and Song 2 are shown. In other cases,such as Track 3, a track contains a new song that is a cover of anexisting song, so both songs and all their respective rights holders areshown. Track 4 comprises samples of songs from various tracks from otherrecordings, and again, all the songs and all their respective rightsholders are shown. In general, a product can be considered as acomposite object that is an unlimited hierarchy of multiple embeddedcomponents. As a result, the end product may have a very complicatedroyalty earnings calculation model.

The SRP may be designed following the principles of Service OrientedArchitecture (SOA). In this architecture, services may be orientedaround a message bus that is responsible for passing messages from oneservice to the next. A presentation layer may be responsible forcreating task-oriented GUI for different types of users (business roles)of SRP.

An application layer may represent the business logic of the system. Itmay be based on a set of loosely coupled services whose orchestrationand execution may be driven by a Finite State Machine-based businessprocess model (BPM) engine. The BPM engine and the services maycommunicate with each other through a message broker using apublish/subscribe mechanism. In one embodiment, the message broker maybe based on the Java Message Service (JMS) specification. Types ofbusiness logic in the SRP may include Declarative, which may be definedeither as a Finite State Machine for major business entities thatimplement BPM engine or business rules-based, as implemented for RoyaltyCalculation Services; Procedural, which may be services that havestraightforward logic that is not subject to change by business usersand may be implemented by Java classes; and Workflow, which may controldistribution and management of analysts' tasks and approval processes,as well as time management functions.

A data layer may provide the storage of information within the SRP. Inone embodiment, operational data may be stored in databases containingdata for royalty processing and reporting data may be stored in adifferent database for performance reasons. In one embodiment, thedatabases may use ORACLE PL/SQL technology. In one embodiment, datastored in files may be stored in XML format and SRP interfaces may useXML documents to represent data for transfer.

Instead of making the processors and other participants of the businessprocesses aware of exactly which events to which they are subscribed andwhich events they publish, one embodiment of the invention moves thisknowledge to special lightweight publishers/subscribers. Differentcombinations of these publisher/subscribers can specify a highlyefficient batch processing. Whenever necessary, the clients, processorsand state machines can play the roles of being their ownpublisher/subscribers.

Royalty calculations are the core of the SRP 101. Most SRP businessprocesses may be built around royalty calculation services, feeding themwith sales data and royalty calculation rates from the contracts for allrelated royally recipients. Many intermediate events could happen beforeSRP decides that royalty calculation results are accurate and can bepassed to the accounting system. FIG. 3 shows an overview of the royaltycalculation processes 300 of the SRP 101. In this embodiment, the flowSales Information 301 triggers a flow of calculations in three paths,with data coming from the Repertoire Owners World 113 and thePublishing/Licensing World 110. The first data path is UnionCalculations 302, drawn from Union Rates 303. The second path is ArtistCalculations 304, drawn from Artist Rates 305 and Product LifecycleInformation 306. The third path is Copyright Calculations 307, drawnfrom Copyright Rates 308 and License Lifecycle Information 309. The flowof data from these three paths combines into a stream of informationthat may be used to accumulate Royalty Earnings 310 in Accounting World112. The fact that not all information necessary for royaltycalculations comes into the system at the same time adds an additionalcomplexity and may force the SRP to make intermediate decisions, waitfor information to become available, and then make recalculations.

The SRP 101 lives in a complex world communicating with other systems.In particular, it may receive all products and product updates from aRepertoire Management System (RMS) 401. FIG. 4 shows one embodiment of atop-level view 400 of the interlinking of the SRP with the RMS, fromwhich it may receive all products and product updates. The RMS maycontain data about who owns rights to and who publishes each product.The RMS may interact with different aspects of the Publishing World 110,including Manufacturing 110 a, Digital Partners 110 b, and SOP/WMS 110 c(SOP is an abbreviation for Sales Order Processing and WMS is anabbreviation for Warehouse Management System). The Repertoire Owners 423may have stakes in the both the RMS and the SRP, as shown by the dottedline of Product Links 422 connecting those entities.

FIG. 5 presents a generic architecture of one embodiment that allows SRPto replace batch royalty calculation processes with one process, aRoyalty Calculation Process that may be always active and processessales records on a transaction basis rather than in batch mode. TheRoyalty Calculation Process may react to all system events using anevent managing mechanism 500. The Message Broker 530 may provide ageneric event management mechanism with publish/subscribe facilities.Events may travel between clients (publishers/subscribers) in the formof messages. This allows different SRP clients, such as processors andstate machines, to produce and consume system events, such as “new salesrecords came” or “a rate matrix has been changed.” Message Broker 530may interact with Processors 521 a through 521 n to execute CommonServices, such as a royalty calculation service, 520 a through 520 nbased on events produced by State Machines 501. The messages associatedwith events usually contain the event type, an object ID on which theevent happened, and other event-specific information. SRP services,called Processors, may communicate using a publish/subscribe mechanism.They may be invoked when they receive messages to which they aresubscribed that are emitted by the State Machines or by otherProcessors. They can also publish messages that can cause statetransition or invocation of other Processors that subscribe to thesemechanisms.

State Machines 501 through 505 a-n may be defined for all types (notinstances) of business objects whose life cycles are maintained by SRP.They may specify process- or company-specific reactions to the statechanges of the major SRP entities. SRP may maintain separate statemachines for sales records, products, contracts, licenses, sub-ledgers,and other major entity types. State Machines may define and control howthese objects change their states when certain events occur. StateMachines may subscribe to receive all their events, and they may publishall their state transitions as events as well. A state machine may beenvisioned as a table with a list of possible states as rows and a listof possible events as columns. Each cell may define how the proper eventchanges the proper state. A state machine may subscribe to receive allits events. At the same time, it may publish all state transitions thatactually happened as other events. An example of a state machine ispresented in FIG. 7. The state machines may govern which pre- andpost-processing logic is executed on every transition and what messagesare emitted.

Time Manager 510 may be a special processor that is responsible forhandling temporal events. Time Manager 510 may publish differenttemporal events at pre-defined time. Many SRP royalty calculation andreporting processes may be initiated on certain dates via the TimeManager. Time manager may also be subscribed to all SRP temporal eventslike “Delay this record calculation for 10 days” during which somemissing copyright data can be provided. Process- or company-specifictime delays are defined as temporal events. Use of the Time Manager 510may allow the system to time-stamp events and may prevent events frombeing lost or overlooked.

FIG. 6 is a snapshot of one embodiment of the main SRP RoyaltyCalculation Process 600 described above. In this example, an initialProcessor “Load” 603 may receive the sales records from database 602 andthen publishes event “Initialize” 620 in Message Broker 530. MessageBroker 530 activates the State Machine “Sales Record” 601, which issubscribed to this type of event. In this example, the State Machine 601is further defined in FIG. 7. State Machine 601 transfers the recordfrom the state “New” to the state “Waiting for Validation,” makes theproper changes in the database 602, and publishes a new event “A recordis waiting for validation.” Message Broker 530 activates Processor“Validate” 604 which is subscribed to this type of events. Processor“Validate” 604 validates the content of the sales record and publishes anew event “Validated” with a parameter True or False. In this example,let us assume the validation was successful. Message Broker 530 againactivates the State Machine 601. State Machine 601 transfers the recordfrom the state “Waiting for Validation” to the state “Waiting forMatching,” makes the proper changes in the database 602, and publishes anew event “A record is waiting for matching.” Again, another Processor,for example, one that could be called “Match Record with Rate Matrix”that is subscribed to this event will be activated, and the process willcontinue until there are no events to handle.

Thus, the proposed architecture 500 may eliminate the need to rundifferent royalty calculation processes on a daily, weekly, monthly orquarterly basis. Every royalty calculation process may be implemented asa sequence of special processors that are always running or waiting torun. The processors may be activated at any time when the relatedobjects, such as sales records, contracts, licenses or rate matrices,are changed. Therefore, the resulting sub-ledgers in the AccountingWorld may always have the latest calculation results. The scheduledaccrual and statements run may be initiated by the proper time events,and can merely summarize the latest calculation results already saved insub-ledgers.

Business rules that define the royalty calculation logic may beexpressed using various royalty keys and factors (rates) that implementthe established policies of different repertoire owners. This logic isusually defined in contracts and licenses. SRP proposes a generic way todefine, maintain and execute Rate Matrices (RM) that corresponds to thedifferent contracts and licenses. The RM may specify the following,non-exclusive list of factors:

different royalty calculation factors

different combinations of royalty keys that specify conditions underwhich these royalty factors should be applied

calculation methods and algorithms that should be used to calculateroyalties.

FIG. 8 shows an example of a rate matrix. The data may be broken downinto Royalty Keys, such as medium, the product type, the price level,etc. Various different royalty streams may flow from each track of eachitem, and each separate entry in the record may have a different royaltyallocation. Additionally, percentages for the artist, the copyrightowners, and all other parties with some rights to the product may beadded and layered on top, and the royalty rates may change depending onvolume reached per time unit, such as albums per month or per year, oron total volume, or on geographical distribution, or any of many othervariables.

Different SRP business processes at different points of time may launchthe appropriate royalty calculation service. A business process may feedthe service with the related sales data and may receive back from theservice the calculated royalty amount or rejections with explanation onhow it was calculated or why input was rejected. The service may use thecorresponding RMs to do the actual calculation. While the calculationlogic may reside inside each RM, the major service development effortsmay be directed to a unified way to specify the service's input andoutput, bring the corresponding RMs to the picture and then efficientlyexecute them. A royalty calculation service may receive as input arecord with sales-related information that may include sales informationcorresponding to a sales record, links to the associatedcontract/product/licenses and links to a specific execution environment,such as repertoire owner, seller, etc. A royalty calculation service maymatch the sales record with a product sales agreement and process theinput record and related information to calculate the royalty amount. Inone embodiment, a license on a product that is the subject of a productsales agreement may be validated as part of the process of royaltycalculation and management. In one embodiment, there can be two types ofprocessing results. The first, Positive, is where the service may returnthe calculated amount and, if requested, explanations of how this amountwas calculated. The second, Negative, is where explanations are offeredas to why the royalty cannot be calculated. A business process thatlaunched this royalty calculation service may be able to interpret theresults, making the process-specific changes in the major SRPrepositories.

In one embodiment, a royalty payment is the amount due for a salestransaction based on the calculation method specified for the salestransaction and the calculation variables returned from the RM. Ingeneral, a default royalty can be calculated using the following genericformula: Royalty=Adjusted Units×Adjusted Base×Adjusted Rate. In oneembodiment, the RM specifies the base, rate and unit values, and theadjustments for possible situations related to different types ofproducts and sales. In one embodiment, the rules by which thecalculation methods can be applied are not hard-coded, and can beconfigured or redefined directly inside RMs. At the same time, thedefault definition of the calculation methods can be used withoutrequiring the attention of royalty analysts. The actual selection of themethods or algorithms can be done on the level of RM templates.

The above description is presented to enable a person skilled in the artto make and use the invention, and is provided in the context of aparticular application and its requirements. Various modifications tothe preferred embodiments will be readily apparent to those skilled inthe art, and the generic principles defined herein may be applied toother embodiments and applications without departing from the spirit andscope of the invention. Thus, this invention is not intended to belimited to the embodiments shown, but is to be accorded the widest scopeconsistent with the principles and features disclosed herein.

What is claimed is:
 1. A computer system for royalty managementconfigured to perform the following steps: receiving a sales record froma database; publishing an initialization event message based on thesales record; activating a state machine with the initialization eventmessage; updating a state of the record from the state machine inresponse to the initialization event message; validating the salesrecord; publishing a validation event message; activating the statemachine with the validation event message; updating a state of therecord from the state machine in response to the validation eventmessage; publishing a matching event message; matching the sales recordwith a product sales agreement; and calculating a royalty payment usingthe matched sales record and a rate matrix.
 2. The computer system ofclaim 1 configured to perform the step of validating a license on aproduct that is the subject of the product sales agreement.